The Federal Reserve cut rates last year in an effort to reduce consumer interest rates on mortgages and loans. The result was lower rates for most loan and savings products, but there appears to be one exception to the rule. Credit card rates continue to increase as credit card issuers take any actions they can to recoup losses that they face from delinquent accounts.

Low-rate credit cards now average 11.62% while balance-transfer cards are at 13.15% and cash-back cards are at 13.82%. In November, Citigroup raised rates for 20%of its accountholders by an average of 3% (around the same time that it received $300 billion in government funding). Worse, these rate hikes are taking place across the board regardless of credit score. Most of these accounts carried low rates for years, which caused many consumers to be caught off-guard.

According to many experts, raising rates during these tough times could be a double-edged sword for companies. Raising rates may help their bottom-line in the short-term, but long-term the higher rates may cause an increase in defaults, where the credit card issuers get nothing. Higher rates can even push the most financially-stable consumers closer to financial ruin as many small businesses use credit cards for working capital loans.

Millions of Americans failed to qualify for Obama’s program to help troubled homeowners, despite the fact that many of them are in a substantial amount of trouble with their mortgage. Many no longer have enough income to pay their loans while others can only afford the payments but don’t qualify for refinancing because the value of their home is far below the balance of the loan.

Many Americans are now questioning the wisdom of making monthly payments on a loan that may take 10 to 15 years to get back to the value it had just a year or two ago. While many people have a fear of giving up on a contract, it isn’t as disastrous as it sounds these days. It is almost always preferable to negotiate a better deal on an existing mortgage, but lenders are not likely to sue if you walk away.

One option for many Americans is a short sale – that is, the process of selling a home for less than its worth with the lender’s permission. Other lenders are more forgiving and will let you hand over the deed for your house in exchange for an agreement not to start foreclosure proceedings. And as a final option, foreclosure is a last option or homeowners unable to make their payments.

Other implications of abandoning a mortgage include a higher tax burden (since the abandoned debt is taxed as income) and a lower credit score that could stay with you for a few years. However, the benefit of not massively overpaying on an asset could make it worthwhile in the long-run.

Print newspapers and magazines rely heavily on advertising fees in addition to subscription fees to subsidize the cost of printing and distributing the news each day and week. Unfortunately, the economic slowdown has virtually stopped advertising and forced many newspapers and magazines to shut down their operations after hundreds of years of business.

The Seattle P-I is one of these newspapers that may experience this fate. The 148-year-old newspaper will switch to an online only format and reduce its staff to just 40 employees - 20 reporters and 20 salesmen. However, many are skeptical that an online newspaper can generate enough revenues to support a building and staff of that magnitude.

The failure of Seattle P-I follows that of several other newspapers. Even large publications have sustained huge losses, such as the New York Times. The times has seen its stock price drop from around $25 per share in the middle of 2006 to nearly $4.00 per share in recent days. Eventually, these large newspaper operations are hoping that advertising will pick up once more and sustain them.

Most of the United States has been hit hard by an economic recession and jobs can be difficult to come across. However, there are a few pockets where jobs are expected to pick up strongly. Here are a few places to consider living before you give up on finding any employment in the United States:

1. Yakima, Washington – Yakima is known for its apples and hops for beer, and last year’s harvest created a huge demand for workers. Packing and juicing companies employed people year round and the city is expected to see its net employment jump 21% during the year.
2. Kennewick, Washington – Kennewick may be one of the smartest cities in the United States with the most Ph.D.’s per capita, but the region’s farmland has also provided 19% more jobs this year growing potatoes, corn, asparagus and wheat.
3. Amarillo, Texas – Those looking for a more exciting job may want to check out Amarillo, where employment will growth 15% in 2009. Pantex is the largest employer there, with more than 3,000 people refurbishing nuclear warheads. There are also many jobs in the medical services and food processing industries.
   

Americans are saving more money than ever before as the economic crisis continues to weigh on households. The average household saved 5% of their disposable income in January, which pushed the personal savings rate to a 14-year high. Many experts consider this a healthy change for a nation that has traditionally seen a negative savings rate over the past several years.

The move to save is good news for banks, who are using consumer deposits to bolster their balance sheets. Remember, banks make money via the interest rate spread between what it pays depositors and charges those who take out loans. Right now, loans happen to be very expensive, so many banks can afford to dole out more cash to depositors to attract them for the long-term.

Many banks are now offering cash sign-up bonuses of up to $100 and attractive rates that surpass the current record-low federal funds rate of 0% to 0.25%. In fact, some banks are offering interest rates that can exceed 6% APY! Southern Missouri Bank, Kansas State Bank, Rocky Mountain Bank, and First Robinson Savings Bank are all offering these attractive yields.

Meanwhile, cash bonuses are increasingly being paid to consumers just for opening an account. Compass Bank is offering $100 while others like Citigroup and HSBC are offering $25 or more to setup an account at their banks. Even highly-accessible online-only banks are offering relatively high rates of 2.55% to 2.65% on many accounts. Combined, these are great deals for consumers!

The average cell phone bill may be around $50, but the average consumer is paying $3 per minute because they’re only using a fraction of their minutes each month. The Times reported the number based on the average number of minutes charged in more than 700 San Diego telecom bills and dividing by the average number of actual minutes used.

The Consumerist.com believes that these numbers are skewed by the small amount of people that pay for a large amount of minutes and only use a few. However, even with those people removed, the Consumerist still believes that the average cost per minute is between $0.50 to $1 per minute. This is contradictory to the common belief that cellular costs are coming down.

Consumers that want to make sure that they’re on the plan with the best value may want to check out online services like BillShrink.com and MyValidas.com. These services can help find cell phone plans that fit with the actual number of minutes used each month.

Credit cards have minimum payments and, if consumers do not meet those minimum payments, the creditors may start calling. Most credit card agreements require payment of the minimum amount due on a monthly basis. So, consumers that make below-minimum payments are subject to negative actions from the bank. These can include card cancellation, creditor calls, and reports to the credit bureaus.

The largest concern for consumers making below-minimum payments are the fines. Many credit card companies charge a $29 to $39 monthly fine for not paying the minimum on time, and this amount can be more than the consumer’s below-minimum payment! This means that each monthly balance could move higher and higher with no end in sight – something called negative amortization.

The best solution is to rework monthly budgets to come up with enough money to pay more than the minimum. If this is not possible, it may be wise to call up the credit card company and see if the will negotiate at all on the amount due or rate. And finally, if none of this works, it could be wise to seek help with a debt settlement company if the amount is high enough to justify it.

President Obama’s tax plan is set to increase the tax bill for the wealthy, but it could end up hurting many middle class citizens living in richer areas of the United States. Many people living in the $200,000 to $400,000 per year income range live in high-cost areas of New York or California and are stretched to afford their homes when real estate prices were higher. These people certainly are not rich, but they are worried that the president’s plan could push them over the edge.

The reality is that many of these people are already subject to higher taxes because they are paying the alternative minimum tax. Even with the new tax hikes, the amount of taxes these people owe may not change that much because what they owe under the regular income tax may not push them out of the alternative minimum tax territory. But higher income people in states with lower income or property taxes are more likely to pay bigger sums.

The other big concern for investors is the capital gains tax rate, which would change depending on income. People in the top two tax brackets would see their capital gains tax rise to 20 percent from 15 percent while middle income families would still pay the same amount. This may deter many people from investing in the stock market as the price has gotten much higher…